IV&V • Assessment Services • Program and Project Management

Well, it depends on what you consider to be an acceptable risk, but I think we might agree that a 1 in 6 probability of a 200% cost and 70% schedule overrun is not exactly rare and not one that I would relish having on my project. Unusual perhaps….but significant enough to warrant my attention.

The lesson to be learned about Black Swan events is that as managers, we often have false assumptions based on the limits of our experience or on the knowledge of the day. Swans are white because every swan we have ever seen is white. There are limits to our understanding of causation.

Recent studies indicate that rare and improbable events occur much more than we expect. Our thinking is limited in scope and we make assumptions based on what we see, know, and assume. Reality, however, is much more complicated and unpredictable than we think.